Age of Aquarius (AA) is a well-established manufacturing company that produces new age furniture. AA has...
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Age of Aquarius (AA) is a well-established manufacturing company that produces new age furniture. AA has used direct labor hours as the basis for allocating company-wide overhead for many years. However, given recent investments in manufacturing technologies, management feels that ABC costing would perhaps provide a more accurate assessment of the true price of the goods produced. The following costs have been accumulated and corresponding drivers measured: Activity Lathing Factory production Inventory Materials Storage/Wages Handling Cost Pool Depreciation Utilities Type Chairs Tables Driver TTT Machine hrs. Direct labor hrs. # of Shipments Arial Expected Production 10,000 units 500 units Budgeted Cost $40,000 $50,000 Additionally, the following information is available relative to production levels: 3 (12pt) Actual Cost $120,000 $110,000 250 shipments Actual Production 7,500 units 600 units $40,000 $53,000 T-E EE Budgeted ver Usage: Chairs 50,000 hrs 100,000 hrs M Actual Driver Usage: Chairs 45,000 hrs 84,000 hrs a. What are the activity rates for this period? b. Using these rates, what is the total overhead allocated to a chair produced this period? What is the per-unit overhead allocated? c. Using these rates, what is the total overhead allocated to a table produced this period? What is the per-unit overhead allocated? Click Save and Submit to save and submit. Click Save All Answers to save all answers. 230 shipments Budgeted Driver Usage: Tables 10,000 h 20,000 hrs 50 shipments Actual Driver Usage: Tables 15,000 hrs 24,000 hr 60 shipments IX Save A Age of Aquarius (AA) is a well-established manufacturing company that produces new age furniture. AA has used direct labor hours as the basis for allocating company-wide overhead for many years. However, given recent investments in manufacturing technologies, management feels that ABC costing would perhaps provide a more accurate assessment of the true price of the goods produced. The following costs have been accumulated and corresponding drivers measured: Activity Lathing Factory production Inventory Materials Storage/Wages Handling Cost Pool Depreciation Utilities Type Chairs Tables Driver TTT Machine hrs. Direct labor hrs. # of Shipments Arial Expected Production 10,000 units 500 units Budgeted Cost $40,000 $50,000 Additionally, the following information is available relative to production levels: 3 (12pt) Actual Cost $120,000 $110,000 250 shipments Actual Production 7,500 units 600 units $40,000 $53,000 T-E EE Budgeted ver Usage: Chairs 50,000 hrs 100,000 hrs M Actual Driver Usage: Chairs 45,000 hrs 84,000 hrs a. What are the activity rates for this period? b. Using these rates, what is the total overhead allocated to a chair produced this period? What is the per-unit overhead allocated? c. Using these rates, what is the total overhead allocated to a table produced this period? What is the per-unit overhead allocated? Click Save and Submit to save and submit. Click Save All Answers to save all answers. 230 shipments Budgeted Driver Usage: Tables 10,000 h 20,000 hrs 50 shipments Actual Driver Usage: Tables 15,000 hrs 24,000 hr 60 shipments IX Save A
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Financial and Managerial Accounting
ISBN: 978-1285866307
13th edition
Authors: Carl S. Warren, James M. Reeve, Jonathan Duchac
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